CAPE TOWN  A leading South African property expert has urged
government to change its stringent work-permit regime to
assist with luring skills needed to boost growth and make SA an investment-friendly
destination.

Barak Geffen, executive director of Sothebys International Realty,
said yesterday it would make macroeconomic sense to attract the best
skills to the country by allowing foreigners to work and invest in property
in SA.

In a climate where government has indicated it wants to restrict ownership
of foreign property, Geffen said SA could follow the example of Australia,
which was a far more investment-friendly destination that reflected
14 years of uninterrupted economic growth.

The country was rated number one in the world competitiveness year
book, and was ideally placed in the Asia Pacific rim, the fastest-growing
regions worldwide, he said.

Australia has allowed foreigners to invest and work in Australia
and 25% of its work force is foreign, which adds to the countrys
skills pool and is a reason it is one of the fastest growing economies
in the world, he said.

Geffen said it would make sense to attract the best pool of talent
from throughout the world to make SAs economy more productive.

But you cant attract the best pool of talent if you dont
allow them to get work permits, which in SA are stringently regulated,
he said. Geffen said the cooling of the local property market over the
past year was worrisome.

Despite the soaring prices of recent years, however, the affordability
of local housing  as measured by the ratio of house prices to
income - remained well below 1980s levels, whereas in the US it
had risen quite steadily.

Reserve Bank data shows that household debt as a percentage of disposable
income rose to just more than 60% recently, high by historic standards,
but far lower than levels in the US and many other countries.

This demonstrates that SA is less risk-tolerant in using debt
to finance investments in real estate outside of primary residences,
and so there is less of an artificial boom effect on the property market,
said Geffen.

When comparing SA internationally, it still offered some of the most
affordable prime property in the world, he said.